This excerpt taken from the ISSI 10-K filed May 30, 2007.
We have entered into indemnification agreements with our officers and directors containing provisions that may require us, among other thing, to indemnify our officers and directors against certain liabilities that may arise by reason of their status or service as officers or directors and to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified.
The Company purchases goods from SMIC in which the Company has less than a 2% ownership interest. Lip-Bu Tan, a director of the Company, has been a director of SMIC since January 2002. For the year ended September 30, 2006, the Companys purchases of goods from SMIC were approximately $21,352,000. At September 30, 2006, the Company had an accounts payable balance to SMIC of approximately $4,440,000.
The Company sells semiconductor products to Key Stream Corp. (KSC) in which the Company had approximately a 22% equity interest at September 30, 2006. Kong-Yeu Han, a director of the Company, is a director of KSC. For the year ended September 30, 2006, the Company sold approximately $140,000 of memory products to KSC. At September 30, 2006, the Company had an accounts receivable balance from KSC of approximately $155,000.
Lip-Bu Tan has been a director of Flextronics since April 3, 2003. For the year ended September 30, 2006, the Company sold approximately $830,000 of memory products to Flextronics. At September 30, 2006, the Company had an accounts receivable balance from Flextronics of approximately $251,000. The Company had been doing business with Flextronics prior to Mr. Tan joining the board of directors of Flextronics. The Company has determined that Mr. Tan did not have a direct or indirect material interest in the Companys transactions with Flextronics and that the Companys transactions with Flextronics are not material to Mr. Tans status as an independent director.
As of August 28, 2006, the Company entered into a letter agreement with Riley Investment Management, LLC, SACC Partners, LP, Bryant R. Riley, B. Riley & Co. Retirement Trust and B. Riley & Co., Inc. (the Riley Parties), as amended as of November 30, 2006. Pursuant to the letter agreement, the Company expanded the size of its Board of Directors from seven members to nine members and elected Bryant Riley and Melvin Keating to fill the vacancies created by such increase. Bryant Riley is a director and an affiliate of the other Riley Parties. Additionally, the Company agreed to deliver to the Riley Parties written commitments from two of the Companys current directors (other than Jimmy S. Lee and Kong Yeu Han) not to seek or accept re-nomination for election to the Board of Directors at the Companys 2007 annual meeting of stockholders. The Letter Agreement further anticipates that the Companys nominating committee will nominate for election at the Companys 2007 annual meeting of stockholders the six remaining directors and one additional independent director (who is Mr. McDonald) and that the size of the Board of Directors will be reduced to seven members at such time.
As of September 7, 2006, the Company entered into a Standstill Agreement with the Riley Parties as contemplated by the letter agreement described above. Pursuant to the Standstill Agreement, the Riley Parties have agreed, until the date on which proxies for the Companys 2008 annual meeting of stockholders are first solicited, not to, among other things:
This excerpt taken from the ISSI 10-K filed Dec 15, 2005.